Does IBKR’s GlobalTrader Make Life Easier for Beginner Investors?

A long time ago, my dad was “poisoned” by his friend into becoming an audiophile.

If you are a fellow audiophile, you might go through the customary rites of going to audio ships in Adelphi to check out speakers, deliberating whether to go above your budget because a specific grade of equipment sounds much better than what you came to check out.

My dad is not very literate in English, so I end up helping him check out how to tune some of these amplifiers, equalizers and speakers. Mind you, in those days, most of the resources were text-based. YouTube was less established.

If you ask me, I don’t want to tune so many things. I want my rock songs to sound great without an echo. I wonder whether everyone needs to do so much tuning every time so that the music sounds good.

This may be the feeling that many people get with Interactive Brokers (IBKR).

Most investors in the international region know how competitive the IBKR platform is:

1. Allows you to trade a large selection of investments (CFD, stocks, bonds, options, mutual funds, futures)
2. Trade stocks in various exchanges in the United States, Canada, Mexico, Austria, Belgium, Estonia, France, Germany, Hungary, Isreal, Italy, Latvia, Lithuania, Netherlands, Norway, Poland, Portugal, Russia, Spain, Sweden, Switzerland, UK, Australia, Hong Kong, India, Japan, Singapore, South Korea.
3. Low commission.
4. Comparatively low margin lending rates.
5. Automatically earn interest on your cash deposits.
6. Near spot currency conversion.
7. Use by registered investment advisers (RIA) and individuals to manage clients’ money on a discretionary basis.
8. Different estate ownership structure
9. No ongoing fee.

I been using it for the past few years and honestly cannot find a lot of platforms that has the breadth and depth.

But there was always one gripe: Their mobile application is not the most friendly for begineers.

You can see it in some of the comments in this Saxo flame thread.

Here is one such comment:

I think I should add another perspective here as a happy user of Saxo (I’m sure there are many others out there) despite the high conversion fees.

The total spread of 0.75×2=1.5% to me is a paltry sum. I say that because the Saxo platform (both desktop and mobile) is really good. To me as a human trader I value my convenience and ease of use. If a tool charges me 1.5% I’d gladly accept it since it is well made and allows me to make great decisions at the right time.

Put another way, the power of the tooling enabled me to make decisions that well covered the 1.5%. I don’t think I’d be able to make those decisions using IBs platform which as many have mentioned is very complicated. Of course you must be able to utilize all of Saxos charting functionality to appreciate the value, ie what you get for paying the 1.5%. The fact that no one here has mentioned the benefit of Saxo leads me to believe that most here are not utilizing the tool to its full potential, and then of course it makes sense that they are complaining about the rate, since they are getting nothing for the higher rate they pay.

Another related point, on top of the fees, I even pay them a monthly charge of about 30SGD to subscribe to real time pricing for Nasdaq and NYSE within Saxo. Penny Pinchers would tell me I am dumb to do so, I can get real time pricing from Yahoo Finance etc. I did try that for awhile, but the convenience of having the real time prices within the platform where you execute far outweighs the little 30SGD fee. Another way to look at it: the price subscription enabled me to execute my trades more efficiently, definitely saving me more than the 30$ I pay.

A final point is that I’m a software engineer by profession. That makes me appreciate and understand the difficulty and cost of developing and maintaining a great software platform, connecting all data sources, ensuring real time delivery of pricing and trade data etc. Most non technical people don’t appreciate this, and think everything should be done for their (self entitled) selves at impossible prices. Hence to me the rate they are charging for currency conversion is fair when you take into account the great software they have. How else would they make money and survive if their trading cost is lower than other (less advanced) platforms?
If you can’t appreciate or don’t use their advanced functionality then just switch to one of the local banks trading platforms which are cheaper but don’t have such a good platform.

TL;DR: if you don’t know how to use a chainsaw, just buy a saw. Don’t buy a chainsaw and complain how it costs more than a saw!

Bryan.

I don’t think I quite agree with his perspective. We should recognize that some value-add services leads to better decision making, but in the grand scheme, the cost we pay for our transactions has to be reasonable.

This is a reason why Interactive Brokers created IBKR GlobalTrader.

What is GlobalTrader?

InteractiveBrokers want to create a simple application that allow us to trade stocks worldwide.

The focus is to streamline the design, so that the application is easy enough for beginning investors to use, yet GlobalTrader is powerful enough for stock traders of any level.

The allocation was developed for global investors. For example, they want to make it easy for us to deposit money in 24 different currencies.

IBKR started their business more known as a market-maker (which may explain how they are able to pipe the backend of the international markets, offer currency conversion at near spot rates).

IBKR’s founder and chairman started IBKR from the perspective of a computer programmer. Current CEO Milan Galik also join IBKR as a software developer.

Creating a sophisticated platform electronically is in its roots but Milan Galik should be quite certain in order to take a greater share of the retail pie, they have to improve their UX.

This is where GlobalTrader comes in.

My First Impressions of GlobalTrader

I wasn’t sure whether GlobalTrader is for me because I grown used to the workflows of IBKR Mobile.

I would pigeonhole myself as an intermediate user, but to be honest, I am not too advance as well.

You do not need to install IBKR GlobalTrader, IMPACT, IBKR Mobile, but choose which application most suitable to you.

Here are some of the notable things I noticed while using GlobalTrader for the past few weeks.

What Can You Do in GlobalTrader?

The challenge of creating a trading application that is more friendly to new investors is to hide advanced functionality. Initially, I thought GlobalTrader was not for me as an advanced user. However, GlobalTrader came from the same UX canvas as IMPACT and so you can perform the following functionality:

1. Review your transactions
2. Buy and sell securities, including options
3. Check your account value and margin levels
4. Initiate fund deposits and withdrawals
5. Convert between currencies
6. Review your watchlist
7. Review your holdings
8. Access your Interactive Brokers account settings

With these functions, it pretty much allows you to make the day-to-day investment/trading.

GlobalTrader Structure the Information to Help You Make Decisions

If we search up Alphabet (Goog), we will end up with the following on IBKR Mobile:

If we open each tab, there are a lot of information. This is very useful if you are a fundamental investor but if you are a retail investor, you might not know what all this mean.

So you want someone to “nudge” you in the right direction.

GlobalTrader arranges the information such that the analyst calls and news are shown by default. Now, you might have different opinion about how useful these calls were (I don’t place them in high regards) but for newbies, this bridges the gap so that they can have an easier time making an investment decision.

Easily Bundle Option Trades

Perhaps the biggest discovery was how GlobalTrader can help you make complex options trade.

For example, I decide to see what I can execute with options on the SPY ETF:

GlobalTrader help me frame how I should think first. Do I have a few that the SPY will go up or down, will the price stay within a range, move at least a certain degree, or whether the volatility will increase or decrease.

With this, GlobalTrader recommends the following trades:

Options can be challenging for beginners, so it might be useful for GlobalTrader to help you calculate what is your maximum profit, and how much you will stand to lose. Without this guide, some new options trader might make a trade that has a payoff graph that is wildly different from what he has in mind.

GlobalTrader will also tell you how much it costs. For example, a -$12.07 credit means I will get the premium income of $1207 the moment I put a short put strategy.

The maximum loss will let you know that the short put strategy means I will need to get ready a capital of $33,977. This might not be the risk versus reward that is comfortable for me.

I might then choose a put or call spread instead.

Even for a simple option, GlobalTrader explains what price you may break even at:

Download GlobalTrader by Interactive Brokers on Apple App Store and Google Play Today

I have two Interactive Brokers accounts, and GlobalTrader allows me to log in and check both accounts simultaneously. For an amateur options guy, the options guides are damn helpful. You should at least check it out specifically for that.

For those who prefer a more simple interface with the majority of the functionality, you might want to check if GlobalTrader is your cup of tea.

GlobalTrader is available on both Apple and Google’s mobile stores today. Give them a try, and let me know what you think.

You can download them respectively here:

Apple App Store

Google Play

My Comprehensive Interactive Brokers How-to Guides

Interactive Brokers is a great low-cost, financially strong brokerage platform that can be the standard broker for holding your long-term investments. You can access 150 global exchanges, including exchanges such as Singapore, the US, Hong Kong, London, European and Canada.

You will enjoy cheap commissions and zero minimum recurring platform fees or maintenance fees. Convert your funds to different currencies at near-spot rates, paying a flat US$2 fee.

To get started or become familiar with Interactive Brokers, check out my past articles on how to invest with Interactive Brokers. I hope the guides make your life and investing experience easier and brighter.

An Easy Step-By-Step Guide to Setup Interactive Brokers (IBKR)

How to Fund & Withdraw Funds from Your Interactive Brokers Account

How to Convert Currencies in Interactive Brokers

How to Buy and Sell Stocks and Securities on Interactive Brokers

How Competitive are Interactive Brokers Commissions Pricing?

How Safe is it to Custodized Your Money at Interactive Brokers? The things they do better than other brokers.

How Safe is it to Custodized Your Money at Interactive Brokers (2)? Financial strength of IB during recent banking crisis and during Great Financial Crisis

Interactive Brokers have Eliminated the US$10 monthly inactivity fee. More details here.

How to Transfer your shares from Standard Chartered Online Trading to Interactive Brokers

How to trade after-hours and premarket

Create Customized Reports and automatically send them to your email

What is the PortfolioAnalyst Report and Automatically Send the PortfolioAnalyst Report to Your Email

Send Money from TransferWise to Interactive Brokers

Interactive Brokers’ Fluid Interest Income on Cash

Introducing IMPACT by Interactive Brokers